Brent oil trading higher, over $73 amid rising US oil stocks

Brent oil futures are trading firm over $73 a barrel on Thursday amid the latest report from the US confirms that oil stocks in the United States rose, which was a surprise for many analysts.

In London, Brent crude oil futures for October 2010 delivery was trading at $73.44 a barrel, 08.00 GMT on the ICE Futures Exchange after opening today’s trading session nearer the $74 mark.

The EIA said yesterday that crude oil stockpiles in the US rose by 4.1 million barrels in the week ending on 20th August 2010 instead of a forecasted 200,000 barrel decline. Demand for oil is expected to remain under pressure amid poor economic data and the buoyant stockpiles.

The latest EIA data shows the current oil supply glut continues unabated, surpassing record levels reached last week. US commercial supplies of oil and oil products are at the highest level in nearly 27 years.

Oil Prices and the Stock Market Relation

“It’s still intraday price swings in the S&P 500 that are ruling oil prices. It’s awfully simple, a lot more simple than oil fundamentalists would like, but I would remiss to not emphasize what is happening.” said Walter Zimmerman, a technical analyst at United-ICAP.

A Near Term Bottom for Brent Oil?

Brent crude oil futures have fallen about 12 percent from around $83 a barrel earlier this month. The crude oil market is considered by many to have fallen too much, too fast and we are seeing some uptake in oil prices and the low $70 price range seems to be the near term bottom for Brent oil futures.

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